Premium rate increases of 16% on renewal during Q1 2021 were “well ahead of expectations”, said Beazley, as it announced gross written premiums up 16% to $971m for the first three months of the year.
New CEO Adrian Cox said he expected rate increases to continue, with Beazley “well positioned to take advantage of them given our capital surplus”.
All underwriting lines pushed through rate increases during the quarter, led by cyber and executive risks, where rate increases averaged 32% and gross premiums ended the quarter 19% higher at $232m. Beazley said market conditions and rates in cyber “have exceeded our expectations” in Q1, adding that it is “taking significant underwriting action” across its cyber book in response to higher claims from ransomware attacks.
It follows a similar line to Hiscox, which earlier this month said it is taking measures to reduce exposure to elevated ransomware claims. AXA France said this week it will no longer cover ransomware payments.
“Since September 2020, the cyber team has been deploying underwriting action due to the heightened claims environment driven by ransomware trends. These actions include working with clients on ensuring robust risk management practices. While it is too early to determine the full impact, we are seeing early positive indications within the emerging claims trends,” Beazley said today.
Specialty lines and reinsurance both recorded rate increases of 14%, with marine at 12%, property 9%, market facilities 9%, and political, accident and contingency 6%.
All lines, with the exception of political, accident and contingency where renewals were down, recorded double-digit premium growth in Q1 2021. Specialty lines, the largest of Beazley’s underwriting lines, increased gross premiums by 24% to $303m.
Cat losses for the quarter are estimated at $70m net of reinsurance, mainly from US storms. Beazley confirmed its Covid-19 claims estimate of $340m, with the potential for a further $50m in claims should normality not return as expected in the second half of 2021.